For some people starting a business in Australia, deciding whether to set up as a sole trader or establish a company can be pretty daunting. How do you really know which option is best for you? It can be confusing. Between the labyrinth of government websites, lawyer’s legalese and accountants Excel spreadsheets… deciding the best structure can be incredibly tough.
Making the right decisions when starting a business can be hard. Hopefully this simple layman’s guide to deciding whether to sole trade or start a company will help.
Business founders who decide to start up business as a Pty Ltd company are often on the right track. The benefits of a Pty Ltd company structure make setting one up the wisest option. This is especially the case if you are:
starting up with business partners, be they Directors or shareholders
seeking fast growth
plan to supply to major corporations
intend to hire staff
seeking to maximise the benefits of a tax effective business structure
considering equity investment
want ‘street cred’ as an Australian company
already considering exiting the business at some stage
If one or more apply to you, you should seriously consider forming a Pty Ltd company. That’s not to say setting up as a ‘sole trader’ is not a suitable option. However, people who set up to ‘sole trader’ usually fall into one of the following categories:
starting up a hobby business to supplement income
starting a part-time businesses
planning to work as a one man/woman band for the foreseeable future
testing the waters in business for the first time
looking to run a business that fits an existing lifestyle
generally not seeking significant growth.
Every person’s circumstance is different so exceptions to the guidelines above do occur. The decision is not always simple or clear cut. Age, industry sector, start up capital, family status, asset base and a range of variables should be taken into consideration.
For this reason, input from a professional, such as a lawyer, accountant or a specialist start up firm is very much worth considering.
What else determines the decision to choose between sole trader and Pty Ltd?
In a word, liability. And it is so important a point it deserves a section of its own. As a sole trader your liability is unlimited. That means if you are sued your personal assets (house, car, money in bank, valuables etc.) are 100% exposed. A Pty Ltd company structure offers a better level of asset protection, as the business is its own legal entity (and therefore separate from you).
Regardless, for all new businesses we highly recommend business insurance. It’s like going out for a walk on a cold Winter’s night with a really warm jacket on. However, for sole traders with 100% liability risk, insurance cover is doubly important.
What about the cost?
Setting up a Pty Ltd company in Australia is a little more expensive that setting up as a sole trader. However, for the sheer value it delivers, we believe that in many cases it is worth the extra few dollars.…Read more
So you own a business… or maybe you are just starting out. Whatever phase of business you are at, most of us have in common one thing- we must have financing. I am sure you have been exploring your options: financing it yourself, Angel Investing, bank lending options, charge cards, borrowing from a friend or loved ones member… you’ll find methods to get it done.
But have you investigated Kickstarter or crowdfunding in general? It may or may not be for you (depending on your organization, etc) but it is worth investigating. Kickstarter is a financing platform for people with project ideas. An individual puts together a page about their project- what it is, what they are aiming to fulfill, how much cash they will need to raise, etc. If the project is authorized, it goes live and others are able to see it.
Consumers view the project and if they decide to “invest” in it is creation they are able to make a donation. Funding is all or nothing- so if the amount needed is raised, the individual that created the project will get the funds. If support comes up short, money does not exchange hands. This creates security for both the project owner and the investors. You do not have to attempt to build a product without enough money; and purchasers do not put money into a venture that may 0r may not be completed.
So why would I propose this style of fundraising?
1.) The all or nothing concept – there is an ability to fundraise the money you must have and possibly more. If you do not, no damage done. You do not owe anyone anything
2.) The visibility – having possibly 100s of people knowledgeable of your project before it is even built and having “pre-orders”
3.) Control – compared borrowing money, you don’t pay back the funding you receive. The backers through Kickstarter traditionally are given “rewards” for a variety of monetary contributions. So the finances are yours to develop your project. However, understand that money earned through “crowdfunding” can be subjected to taxes
4.) Input – once you fund-raise and build this community around your project, you now have people with a authentic concern in seeing your project succeed- and possibly are already thinking about acquiring it. Go to them for suggestions, with your options, etc. Discover what they would like to see included!
Of course there are many other crowdfunding site out there besides Kickstarter. Take a look at the different outlets, compare them and get going! What do you have to lose?…
When business schools teach entrepreneurship, too much time is spent on writing a business plan geared towards throwing darts at venture capital firms and getting interest in a company before it is even built.
This is hardly an effective plan because it wastes valuable time that could be spent on the business. Moreover, there is no reason for the entrepreneur to start a business only to give it over to 3rd party bankers who could and will pull the plug at first sight of turmoil.
Instead of chasing investors, the entrepreneur should be learning about business via getting their website up and diving in.
Until actual business and subsequent revenue is coming in, there is no real reason for the entrepreneur to take days speaking to an accountant or spend hours blogging about whether they should register their company as a LLC or a corporation. Taking others’ advice is the last thing the entrepreneur ought to do.
This advice is not coming from a columnist. It is coming from someone who started a highly successful company that is consistently eating up market share and now has multiple talented employees from a studio apartment in New York City.
If the entrepreneur wants their business to grow, they must start today. Forget a long, drawn out business plan, here is what the entrepreneur needs – 2 traits that must be quickly acquired:
Thick Skin – people are sensitive to rejection and human beings do their best to avoid rejection at all costs. Conversely, the entrepreneur must become completely desensitized to rejection as they must quickly come to terms with the fact that they are going to encounter resistance and judgment from others every step of the way.
Although I hate the term, entrepreneurs must “put themselves out there” and must buck the trend by ceasing to worry about what others think or what others say. Only if the entrepreneur develops a think skin, can they make a successful run at seeing the other side of the rainbow.
It’s great if the entrepreneur is born with this, however is not necessary as if the entrepreneur wants to be successful, they learn to desensitize themselves to resistance and this can be acquired over time.
Risk Tolerance – in college, too many entrepreneurs are taught to focus on controlling numbers and because of this focus, they don’t learn how to tolerate mass amounts of risk. Managing a high amount of risk is not easy nor is it fun, but it is necessary.
Entrepreneurs, until the business is completely done with its growth phase and can no longer grow at a fast pace, are going to have to live with a gut feeling that is indescribable.
Inevitably, there are certain periods in a company’s growth that will put excessive stress on the entrepreneur.
These company growth stages that tend to induce a large amount of stress include the transition to an office, the hiring of multiple highly paid employees who are crucial to the success of the business and also training these individuals as the entrepreneur must learn that they cannot control everything.
The ability to step back and “let go” cannot be taught anywhere. It is a feeling that can make the entrepreneur dizzy.
Regardless of how mentality taxing giving over control to employees can be for the entrepreneur, it must be done. It has become evident to me that entrepreneurs must gain an excessive amount of risk tolerance in order to succeed.…
How to start a small home based business? Many people ask this question every day. In fact more people are going into business for themselves now more than ever before. Read on to find out how to start a small home based business.
The First step is to Brainstorm
Sit down in a quiet area and really think about what you want to do. Ask yourself what are your likes, dislikes, and talents? What do you do well and not so well. What would you like your business to be about? What are your passions?
Now that you have a better understanding of what kind of business you want to start, you are prepared for this journey.
Why do you want to start a business
You have to make sure this is truly what you want to do. what are the reasons for starting your own company. The perks are nice but can you handle the responsibility?
Reasons most people start a business
More control of work hours, to make more money, being your own boss, controlling your destiny. They prefer working from home, the list goes on and on. Be clear about why you want to be your own boss
What kind of company will it be
Now that we have brainstormed some ideas and know why we want to start a company what kind of business do you want to start? Are you good at gardening? You can write how to garden ebook. There are a lot of people who can use your talents whatever they may be.
Write a plan
Your next step is to sit down and write a step by step plan. How can you get anywhere if you don’t have directions to get there? Once you have a detailed plan you will be on your way to financial freedom.…
Back in 1981, I was just starting my career in television production, and working as the Unit Manager on a location drama. One day, I learned a lesson that would serve me well some 20 years later, when I came to develop a small business. The lesson that I learned in 1981 was that any small detail can really screw up a production. This is how I described it in my book entitled “Don’t Let Your Dream Business Turn Into a Nightmare”:
One day, one of the lighting guys wasn’t feeling well and left the set early. At the end of the shooting day, word was sent out to the set from the production office that the call time for the following day was being moved up from 7 a.m. to 6 a.m., because the production had fallen behind schedule, but the lighting guy didn’t hear the announcement because he had gone home early.
And you, as the Unit Manager, didn’t think of calling him at home to inform him of the scheduling change.
Ordinarily, that might not be a big deal, but this time, it was.
Because -the next morning, as the convoy of production vehicles was pulling out of the television station to make its way to the set – a small town about an hour north of the station -the huge lighting truck remained in place – and a bolt of white hot terror ran from the top of your head down to your toes, as you realized that the driver of the lighting truck was still in bed, because you hadn’t thought to call him to tell him about the change in call time.
Soon there would be 40 people standing around on the set while the lighting crew was waiting for the truck to arrive so that they could set up for the first scene- and whatever time they had hoped to pick up by virtue of the earlier call time would be entirely lost.
So you got into the truck yourself – and without a license to drive a rig that big or any idea of where the gears were – you willed the vehicle to the set – sweat pouring down your face -and you never forgot how that felt, for the rest of your career in television production – or the rest of your life.
The fellow whom I forgot to call was named Mike, and everyone called him “Mikey”.
Forgetting to call “Mikey” almost ended my career in television production before it began.
But the lesson that I learned stayed with me -and so, when I was developing my small business, which was a spa for men, I made a list of everything that I felt could go wrong – every single small detail that I could think of – that had the power to ruin my business.
And I checked that list every single day.
If you are developing a small business, or if you are already running one, ask yourself “What is the ‘Mikey Factor’ that could ruin or damage my business if I forget to do it. Is it insurance, a security system, labor regulations or building codes?
It takes a lot to make a business successful, but the smallest details can make it fail.…
People worldwide seem to be obsessed with Facebook nowadays. The millions of users there want to know about your products, too. This article can help you immensely if you take time to read it.
Using the custom audience feature, you have the ability to upload email information for existing customers and channel advertisements just to them. Your conversion rate will be better and your campaign will be less expensive as a result.
If you have a company that doesn’t have a lot of customers all the time, like a car dealership, then you don’t need to get a business page on Facebook. Your customers often come and go at random and will not be following posts. As an alternative, consider advertising on Facebook instead.
Be sure your posts are valuable. There needs to be some benefit for your followers in all of your posts. That might mean an interesting offer for a new product or useful information about your field. Don’t do a hard sell though.
Have a place on your page where people can sign up or subscribe. Make a connection to communicate with visitors by asking them to sign up or register and offering them something in return. You can hold a contest or a spot for them to put their information in.
You should start a group page for your company. This should be a place for customers to get answers to their questions as well as chat among themselves. You can also give your group customers advance notice of deals and coupons or even create special sales just for them. This is a terrific method of learning all about your customer base.
Avoid posting updates that are irrelevant to your brand and customers. It might be tempting to give your opinion on things or to share personal things with people, but this may not be interesting to your followers. If you need to discuss controversial subjects, save it for your personal page.
Be extra sure that people are able to “share” the content on your page. Posting valuable content will encourage your fans to share that information with their friends. Sharing and interacting with others is the center of Facebook. By providing your customers with valuable knowledge, you will help ensure that these people spread the word about you, which will result in you obtaining even more customers.
Put in real work to keep your fans up to date on your page. This does not mean posting 5 times a day, but it does mean regular updates. Also, don’t waste your followers’ time by posting needless information just for the sake of posting; keep posts interesting and pertinent.
Have some kind of a contest on your page if you want to increase how many “likes” that pages has. You can offer to give people a discount or a free sample of something if you achieve a certain number of likes. This should get you lots of new subscribers and provides an additional opportunity for your winner to check out your prize.
Many different kinds of people use Facebook. You would be shocked at how helpful Facebook can be for marketing. Just use what has been gone over here, and you should have no problem seeing things take shape.…Read more
Video marketing will take your business to the next level. But, it is not that simple to come up with a unique video. The process requires dedication and ingenuity at every step of the way. As you read ahead, you will find great suggestions and ideas about shooting and using videos to increase your marketing efforts.
You should not be intimidated by video marketing. It is simple to make a good video with basic equipment. You can show people how you manufacture products, demonstrate your products, or just talk to them directly.
Few marketing tactics are as effective as video clips. Let your customers know that they can send in questions about your business’s services or products. Use those questions to generate regular videos answering the questions. Offer deals or prizes to anyone whose question is answered in the video.
YouTube is the most popular sharing site, and is worthwhile for its video editing features and analytics alone. For example, it’s possible to add annotations onto your videos. Use this feature to add some information, share a coupon code or a link to your site.
Make sure your videos are optimized. Come up with different titles and descriptions for the videos that you upload to different sites. Don’t forget your keywords! Contact information is a must, too.
Don’t forget about YouTube. That’s the place your campaign and content should start. It provides you with free video hosting. They also are visited the third most out of every website there is. YouTube is a popular search engine and the number one video site.
If the purpose of your video is getting someone to purchase a product or service you offer, then you need a working link they can use to buy it. It is a good idea if it is within the actual video player. Doing it this way will keep the link with the video just in case someone shares or embeds it.
Try to get co-workers or other employees interested in creating videos. Look for a person who is friendly, well-dressed, and comfortable being on film. Don’t hesitate when deciding to use more than one person.
Make sure you take a video camera with you to the public events you attend. You will most likely get the opportunity to speak to experts or document your experience. If you are presenting your products or talking in public, have someone record it.
Fresh content is important. Do not expect viewers to watch your videos and subscribe to your campaign if your content is not interesting enough. You want people to wait on your next move with anticipation. Keep your content fresh and interesting, and this will keep your viewers coming back.
As was stated in the beginning of this article, a good way to improve a business is through video marketing; however, this is easier said than done. Use the tips you just read in order to increase the odds that your video marketing campaign is successful. Keep in mind that you need to do a lot of planning, and properly execute this plan.…Read more